Retail Sector in India

Retail sector is one of the fast growing sectors in the country that
contributes about 10% to the GDP of the country. The current market
size of the industry stands at Rs.66.39 lakh crore in 2018 at13%
CAGR and is estimated to reach at76.87 lakh crore by the end of
2020.Increasing urbanisation, internet penetration and an increase in
the net disposable income has surely paved way for increase in the
online shoppers and use of e-commerce. There can be estimated a
growth in the organised retail sector from 9% in 2017 to 18 % by
2021. It is estimated that the number of online shoppers would tend to
see an increase from 15% in 2018 to about 50% by 2026. Although
the current crisis caused by the Covid-19 is impacting the industry in
terms of shutdowns of malls and shops, a huge decrease in the
consumer demands. Currently, only about 7-8% retail industry is only
functioning.

APPAREL INDUSTRY IN INDIA

 Apparel industry contributes to about 4% to the GDP. The

apparel industry (domestic +imports ) grew from Rs. 2,432
billion in 2010 to Rs. 6,484 billion in 2018 at a CAGR of 13%.
The exports were a little less than the imports; the exports went
up from Rs. 508 billion in 2010 to Rs. 1,076 billion in 2018 at
CAGR of 9.8% while the domestic market grew at a CAGR of
13.8% from Rs.1, 924 billion in 2010 to Rs. 5,408 billion in
2018. India stands at 6th position in terms of exports of apparels
 with US$ 16.2 billion exports in 2018-19 with a market share of
3.3%. Apparel sector in India provides the second largest
employment in India after agriculture, employing about 13
million workers out of which approx. 70% are women

Majority of the sales in the apparels are dominated by the male

segment with 41% then the female segment with 38% and currently
the fastest growing is the kids section with 21% of the overall sales.

PESTLE Analysis of Apparel Industry:

ECONOMIC Factors:

 Government scheme like Interest Equalization Scheme (IES)

provides interest subsidy at 5% per annum on pre and post
shipment export credit.
 The interest rates has also been revised under the Merchandise
Exports from India Scheme (MEIS) for readymade garments
and Made ups - from 2% to 4%.
 Certain exemptions have also been made like IGST on the
import under Advance Authorisation and Export Promotion
Capital Goods Scheme (EPCG) for apparel products.
 Government has increased the custom to 20% from 10 % on
more than 500 products in order to boost the make in India
campaign.
SOCIAL FACTORS:

 Change of preferences of styles with growing age as people look

for comfort with increasing age.
 Change in the fashion trends
 Uncertainty in the buying behaviour as increase of disposable
income during the time of economic boom.
 Decrease in specific items like baby clothes due less birth rates
in the area.

POLITICAL AND LEGAL:

 Many laws are passed by the government to make amendments

in the industry like:
 The government has approved of a scheme in order rebate State
and Central Embedded Taxes for apparels and exports.
 Many Trade and tariff restrictions have also been put on the
apparels exports and imports.

Technological and Environmental Factors:

 Technology has come as a disruptive innovation in the retail

sector.
 Updating the technology has forced the retail players to adopt
the technology to be at par with their competitors.
  There are many barriers to entry in the industry.
 Social media also plays a very major role in the industry for
promotion part.

SWOT Analysis of FBB:

Strengths:
 One the biggest strength of fbb is the large customer base it has
acquired all over the years.
 Its huge range of differentiated franchised products that it offers
to the people.
 Deep discounting available across online channels of FBB, it
acts as a disruptive mechanism.
 Presence of FBB stores Pan India with 94 exclusive stores in
more than 46 cities.
 Presence of strong own brand product portfolio that includes
brands like DJ&C, Buffalo, Lee Cooper Originals, etc.

Weakness:
 People generally consider low pricing of the products as
equivalent to low pricing.
 Overcrowded during the time of sales.
 Falling revenue of FBB in terms of per sq. ft.

Oppurtunities:
  Huge untapped market leading to opening up of 140 exclusive
stores of FBB with an investment of 350 crores by the year
2022.
 Expand its presence by associating with brands like LYCRA for
boost in the sales.
 Grabbing the opportunity of the technological advancements by
improving its online presence, improving its website and
inclusion of future pay for online payments.

Threats:
 Competition that it faces by the outlets selling at similar ranges
like that of FBB example pantaloons, max fashion , etc.
 Uncertainties impacting the stores like the current pandemic
have led to closure of the stores all across the country.
 Constant changes of customers with regards to fashion can lead
to hamper in the sales of FBB.

Competitor Analysis of FBB:

Pantaloons, Max and V-mart, these are the competitors of FBB. These
competitors are chosen as they function on the same pattern like FBB.
These retail outlets mainly target the middle income category people
and the prices are kept as to attract more and people, with discounts
and sales with regular intervals. These competitors can take away the
customer base of FBB and FBB should make its strategies, whether
it’s selling, pricing or advertisement strategies keeping in mind its
competitors.

FBB:

Number of stores:92 exclusive stores and stores inside Big Bazar

Number of cities:46

Annual Revenue: 2600-2800 crores( Approx.)

1) Pantaloons:

Number of Stores: 308

Cities: 155

Annual Revenue of : 3,194 Crore

2) Max India:

Number of Stores: 200

Cities: 80

Annual Revenue: Rs.3000 crore ( approx.,)

3) V mart

Number of stores: 263 stores 

Cities: 189

Annual Revenue: 1433.74 crores